Dozens report banking breaches

Jack Moran @JackMoranRG

Friday

Jun 17, 2011 at 12:01 AM

Dozens of local residents are calling the police — and their banks — to report money is missing from their bank accounts.

Police suspect the missing funds may be linked to an announcement last month by Michaels, a crafts retailer, that crooks had tampered with payment card terminals at 84 of its stores nationwide — including one in Springfield.

“The tampered terminals were capable of capturing information such as name, card account number and PIN” from customers’ credit and debit cards, Michaels said.

Local residents are just now discovering the mysterious withdrawals from their bank accounts, which authorities say may be tied to the Michaels case now being investigated by the U.S. Secret Service.

Police dispatchers in Lane County continued to field a high number of calls on Thursday from people reporting fraudulent charges on their bank statements. Eugene police said about 30 such calls had been received by dispatchers on Wednesday.

Police spokeswoman Jenna McCulley said that when investigators first learned of the spate of local fraud reports this week, they immediately thought it had to be connected to the Michaels breach.

“That is what the initial indications were,” McCulley said.

But detectives have stopped short of definitively linking any single report to the Michaels case because “they want to see if there are any other common threads,” McCulley said.

Cottage Grove resident Shelby Long said someone on Wednesday used an ATM in Rancho Cucamonga, Calif., to steal $503 from her bank account.

Long, who said she made an $11 purchase at Michaels’ Springfield store in early April, discovered the unauthorized transaction later Wednesday when she went online to check her account balance.

“I feel completely violated,” Long said. She added that the stolen cash “was going to be our grocery money.”

Long, 38, said that after reporting the theft to police, she went to Oregon Community Credit Union and spoke with other recent fraud victims who, like her, were there to get new ATM cards.

“We were all talking about (the Michaels case) while we waited in line,” she said.

Heather Billings, a spokeswoman for the credit union, confirmed that “a bunch of people” have visited branches this week to report that someone else had used their debit card information to make unauthorized purchases.

Billings said credit union officials cannot say with certainty that the influx of reports is a direct result of the breach at Michaels.

“Is it related to that? Probably. But can we confirm that for sure? No,” Billings said.

“Regardless of where and how it started, this is an opportunity for us to remind people to always watch your accounts, and make sure what’s happening in there is something that you’re doing,” she said.

In a May 25 notice to customers, Michaels CEO John Menzer said that “tampered payment card terminals were placed by unauthorized individuals” in dozens of stores between Feb. 8 and May 6.

How exactly that tampering occurred remains unclear, said Doug Marker, Michaels’ vice president for loss and prevention safety.

“It would be premature to speculate,” Marker said through a spokeswoman on Thursday. “We are working with the Secret Service in its investigation seeking to determine who might have done this, how they did it and why.”

Since discovering the scheme, the company has installed new “tamper-resistant” Personal Identification Number pads at every store in the country, Menzer said.

Earlier this week, The Oregonian newspaper reported that dozens of Portland area residents reported their debit cards had been compromised or canceled last weekend. Beaverton police linked at least one case to the Michaels data breach.

In Oregon, PIN pad tampering occurred at Michaels stores in Springfield, Beaverton, Tualatin, Roseburg and Medford. Customers who visited stores in 19 other states were also potentially exposed to the fraud scheme, according to the company.

Michaels faces class-action lawsuits filed in federal court in Illinois on behalf of customers who claim their debit cards were used fraudulently after shopping at one of its stores.

Police urge anyone who believes they have been a victim of a fraud to immediately report it to both their bank and their local police department. Anyone who uses a debit card to make purchases is urged by authorities to examine bank statements for unauthorized transactions.

Michaels suggested that, in addition to notifying police and their bank, any customers who believe their card is affected should seek a free credit report.

“You are entitled under U.S, law to one free credit report annually from each of the three national credit bureaus,” Menzer said in his statement. “To order your free credit report, call toll free at 877-322-8228 or visit www.annualcreditreport.com.”

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